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The most amusing response to last week’s column was, “Our esteemed host, despite being gifted with intelligence and perception, is a liberal. And, when considering things political, liberals seem unable to actually look at the evidence.”

However else you interpret political events since the ascendency of the GOP in 2001, only a Fair and Balanced(TM) commentator would give political liberals exclusive credit for an unwillingness to consider evidence.

Not that it matters; I’m neither liberal nor conservative. I’m a member of the Competence Party.

The subject was giving tax cuts credit for tax revenue increases, which I used as an example of implausibility.

There’s a real connection to day-to-day business, since this proposition exemplifies a form of logic popular in business circles. I call it the Tom Peters Fallacy: Look at a success, identify something associated with the success you like, assert a causal relationship, and declare its universality.

Since I started this, I might as well finish it before getting down to business. Here’s my analysis:

  • Tax revenue increases have indeed followed all recent tax cuts, after a one to two year lag.
  • They’ve also followed all recent tax increases …
  • And all periods in which the tax rate didn’t change.
  • More significantly, all modern federal tax reductions have been accompanied by increases in federal spending.
  • And since all federal spending enters the private sector — either as wages to government employees or by paying the invoices of government contractors — it all generates taxable income.
  • Following all modern tax cuts the national debt grew faster than tax revenues.

The most plausible inference: Deficit spending rather than tax cuts is what increased tax revenues.

The relevance for you as an IT leader: Especially in complex dynamic systems (IT organizations are an example), cause and effect relationships are tricky to analyze. They usually have more than one cause, and operate in loops as well.

As long as we’re being political, here’s a news item that will cause many in IT security, and even more so many business travelers, to break out in cold sweats:

I’m quoting verbatim from “Travelers’ Laptops May Be Detained At Border,” by Ellen Nakashima, Washington Post Staff Writer, 8/1/2008:

Federal agents may take a traveler’s laptop computer or other electronic device to an off-site location for an unspecified period of time without any suspicion of wrongdoing, as part of border search policies the Department of Homeland Security recently disclosed.

Also, officials may share copies of the laptop’s contents with other agencies and private entities for language translation, data decryption or other reasons, according to the policies, dated July 16 and issued by two DHS agencies, U.S. Customs and Border Protection and U.S. Immigration and Customs Enforcement.

You don’t have to be a conspiracy theorist or a believer in J. Edgar Hoover’s legendary secret files to be concerned about this. All you have to do is provide support for international travelers.

The clearest risk is business impairment. To illustrate: One of your business travelers goes to Europe, does business, and returns. She documents the trip — maybe a write-up, maybe a spreadsheet, maybe a presentation, or some combination. Being prudent, she copies her files to a jump drive, just in case. At the border, DHS seizes her computer and jump drive. All of her documentation is unavailable for an unknown period of time.

Solution: Provide some means for remote back-up. At its most primitive it might mean e-mailing critical files as attachments. Or, it could mean providing an FTP site, or some public form of Internet backup you consider sufficiently secure.

Then, train, train, and train again. Employees discount low-probability risks as CYA activities. They might be right in this case, too — nobody knows the level of risk, and DHS isn’t likely to provide estimates of how many laptops they might sequester in an average week.

That’s the non-paranoid risk. If you’re paid to be paranoid, consider the possibility that one of the “private entities” with which DHS shares your data is a competitor.

Sure it’s unlikely. But then, security professionals are paid to be paranoid.

* * *

My colleague and good friend Ed Foster passed away last week, of an apparent heart attack. He was a fine journalist, a man of unimpeachable integrity, and showed courage in the issues and companies he took on. He was also a great guy. I liked him a lot.

Our industry will be the poorer for his absence.

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|In: Leadership|Last Updated:

Sometimes deep analysis isn’t necessary. Simple juxtaposition will do.

For example: You have undoubtedly read the scribblings of opinionators on the subject of oil prices and oil company profits. “Of course they make bigger profits when the price of oil goes up,” they patronizingly say. “What else would you expect?”

You have also undoubtedly read scribblings from the same opinionators regarding air carrier profits and the minus sign preceding them. “Of course they can’t make any money,” they explain. “The price of fuel is skyrocketing. That’s why they need concessions from organized labor.”

Juxtapose: When the cost of a key raw material goes up, the inevitable result is staggering profits. Except when the inevitable result is staggering losses. Of course. Aren’t you embarrassed for not realizing it?

Were anyone remotely honest about these two subjects they’d give you entirely different explanations. Oil companies make record profits because when their raw materials increase in price, so do their finished products, in proportion.

Air carriers are in dire straits because they do a lousy job of negotiating with energy companies, failed to reinvest in their fleets, and, for reasons just as inexplicable as everything else about airfares, they don’t raise prices in response to rising costs.

Somebody … and I know this will come as a shock … isn’t telling the truth, the whole truth, and nothing but the truth. Anything except the truth is closer to the mark.

Making matters worse is the extent to which we overestimate our ability to detect falsehood. Yes, we lie to ourselves about our ability to detect when others are lying to us, and we can’t even see through our own self-deception.

As evidence (assuming evidence is still of some value when making a case) I offer “Lie defectives,” (Bruce Bower, writing in Science News, 7/4/2008, reporting on research by Charles Bond Jr. of Texas Christian University in Fort Worth and Bella DePaulo of the University of California, Santa Barbara, published in the July edition of Psychological Bulletin).

Bond states the point succinctly: “When all the evidence is statistically analyzed, deception judgments depend more on the liar than the judge.”

Most of us like to think we’re good judges of character. We assess the appearance, facial expressions, twitches and gestures of those around us and think we can do a pretty good job of deciding who we can trust to give us an honest accounting of things.

It turns out that those appearances, facial expressions, twitches and gestures aren’t very well correlated with honest and dishonest discourse. Which is to say, George W. Bush’s assessment of Vladmir Putin (“I looked the man in the eye. I was able to get a sense of his soul,”) was not an exceptional blunder. Other than its impact it was the same sort of blunder each of us makes all the time.

This matters to you.

All executives, not to mention all POTUSes, need a good detector of (ahem) male bovine excreta (MBE). Since CIOs enjoy a wider variety of sources of this aromatic substance than most other executives, with much of it more sophisticated in construction as well, MBE detection is a critical CIO survival skill.

In developing your own MBE detector, you can’t include your presumed ability to quickly and accurately assess character, because it doesn’t work reliably.

Instead, make use of:

  • Juxtaposition: As noted, when two statements, each of which sound plausible, are mutually incompatible, at least one of them must be wrong.
  • Plausibility: What the heck — as long as I’m offending everyone by using current-events examples, here’s another: How many times have you read that tax cuts return more to the public coffers than they cost? Use the back of an envelope: For a one dollar tax cut to return even one dollar to the Treasury, it will have to generate about three dollars in new income (assuming, for simplicity, a 33% tax rate). That’s an average 300% ROI. Highly implausible.
  • Desirability: The more you’d like it to be true, the less likely that it is true. See tax cuts, above.
  • Past performance: You can’t judge someone’s integrity from their clothing, haircut, expression, handshake, twitches, gestures and gaze. You can judge it from experience. If someone stretches the truth, spins it, presents only the more convenient half of it or simply makes it all up because it gets them what they want and you find out … the situation is the opposite of the boilerplate you find on a mutual fund prospectus:

Even if past performance doesn’t guarantee future results, it’s a pretty reliable indicator.

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